Where to Find Low-Interest Credit Cards

By Jessica Reed

  • Overview

    Where to Find Low-Interest Credit Cards
    Credit cards are a popular choice for those who don't want to carry cash or for people who need to buy an item before they receive their paycheck. The key, however, to successfully using a credit card is to find one with a low interest rate. If you pick out a low-interest credit card, you will save money and run less risk of getting into debt that you cannot pay off. Find out where you can get a low-interest credit card and how it can help you improve your financial situation.
  • History

    The concept of interest originated from the Sumerians, who described the concept of paying back more than you borrowed as "mash" instead of interest. They would give someone a herd of cattle for a certain amount of time, typically a year, and would expect to receive more cattle than they had loaned that person once the year was over. This idea has grown over time to result in the concept of interest as we know it today. Anytime we borrow money, we are usually charged a certain percentage of interest.
  • Function

    Interest is simple in concept, but can get tricky when companies add lots of rules to which the borrower must agree. The idea is that when you borrow money from a company or lender, they charge you a certain percentage of that amount in interest. If you borrowed $100, for example, and the interest was 10 percent, you would pay the original $100, plus $10 more. That $10 is the 10 percent interest charged on the $100 you borrowed.

  • Advantages

    Low-interest credit cards are better because they charge you less money. Since a credit card charges interest monthly, low interest is crucial if you want to get out of debt. Low interest means that you will only have a small amount added on monthly to your credit card bill. This gives you a chance to pay off your bill faster. The faster you pay off your credit card, the less you'll end up paying in interest. Paying off your bill faster will also increase your credit score, which allows you to take out larger loans in the future than you are currently allowed.
  • Availability

    Low-interest credit cards are available from most credit card companies. See "Additional Resource," below, for a list of some of the best low-interest credit cards. To find one with the company of your choice, go to their website and look at their available credit cards. Often cards will be listed in a table showing which have the lowest interest. Typically higher cards, such as Platinum cards, have lower interest rates. Beginner cards will have some of the highest interest rates. Interest is based on your credit score, however. With a bad credit score, you cannot get a low-interest credit card. To improve your score, get a smaller, high-interest credit card, and pay it off in full every month. Your credit score will improve over time, and you'll be able to get a low-interest credit card.
  • Warning

    Remember not to buy more than you can pay off when using your new credit card. Debt is a large problem for many shoppers today, and many people find themselves unable to pay off their bills at the end of the month. Even with a low interest rate, if you cannot pay your bill, you will rack up a large amount of debt to pay back. Also, not paying off the minimum balance each month can cause your credit card interest rate to go up. Be responsible in your spending and pay off your bills, and your low-interest credit card will continue to save you money.
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